N.J. Admin. Code § 11:4-23.15

Current through Register Vol. 56, No. 21, November 4, 2024

Section 11:4-23.15 - Required disclosure provisions

(a) General rules concerning required disclosure provisions include the following:

1. Medicare supplement policies and certificates shall include a renewal or continuation provision. The language or specification of such provision shall be consistent with the type of policy or certificate to be issued. Such provision shall appear on the first page of policies and certificates, and shall include any reservation by the carrier of a right to change premiums and any automatic renewal premium increases based on the policyholder's or certificateholder's age.

2. Except for riders or endorsements by which the carrier effectuates a request made in writing by the insured, exercises a specifically reserved right under a Medicare supplement policy or certificate, or is required to reduce or eliminate benefits to avoid duplication of Medicare benefits:

i. All riders or endorsements added after the date of issue or at reinstatement or renewal which reduce or eliminate benefits or coverage shall require signed acceptance by the insured;

ii. After the date of the policy or certificate issue, any rider or endorsement which increases benefits or coverage with a concomitant increase in premium or subscription charges during the policy or certificate term, shall be agreed to in writing signed by the insured, except if the increased benefits or coverage are required by the minimum standards of this State for Medicare supplement coverage, or if required by other law. Where a separate additional premium is charged for benefits provided in connection with riders or endorsements, the premium charge shall be set forth clearly.

3. A Medicare supplement policy or certificate shall not provide for the payment of benefits based on standards described as "usual and customary," "reasonable and customary," or words of similar import.

4. If a Medicare supplement policy or certificate contains any limitations with respect to preexisting conditions, such limitation shall appear as a separate paragraph in the policy or certificate and be labeled as "Preexisting Condition Limitations."

5. Medicare supplement policies and certificates shall have a notice prominently printed on the first page or attached thereto stating in substance that the insured shall have the right to return the policy or certificate within 30 days of its delivery and to have the premium or subscription charge or fees refunded if, after examination of the policy or certificate, the insured is not satisfied for any reason.

6. Carriers issuing policies or certificates which provide hospital or medical expense coverage on an expense incurred, indemnity, or service benefit basis to persons eligible for Medicare shall provide to all applicants an informational brochure entitled "Guide to Health Insurance for People with Medicare," hereinafter referred to as "the Guide," in the form developed jointly by the National Association of Insurance Commissioners and the Centers for Medicare and Medicaid Services. The Guide is intended to improve the buyer's understanding of Medicare and ability to select the most appropriate coverage. Delivery of the Guide shall be made whether or not policies or certificates are advertised, solicited or issued as Medicare supplement policies or certificates as set forth by this subchapter.

7. To ensure uniformity in content, form and printing, the Guide has been made available through the Publications Department of the National Association of Insurance Commissioners, Kansas City, MO.

8. Except in the case of direct response carriers, delivery of the Guide shall be made to the applicant at the time of application, and acknowledgment of receipt of the Guide shall be obtained by the carrier. Direct response carriers shall deliver the Guide to the applicant upon request but in no instance shall delivery of the Guide occur later than the time of policy or certificate delivery.

9. Except as provided in (c) below, the terms "Medicare Supplement," "Medigap," and words of similar import shall not be used unless the policy or certificate is issued in compliance with N.J.S.A. 11:4-23.8 and all other sections of this subchapter.

(b) Outline of Coverage requirements for Medicare supplement policies and certificates shall include:

1. Carriers issuing Medicare supplement policies or certificates for delivery in this State shall provide an outline of coverage to all applicants at the time the application is presented to the prospective applicant. Except for direct response policies or certificates, acknowledgment of receipt of such outline shall be obtained by the carrier from the applicant.

2. If an outline of coverage is provided at the time of application and the Medicare Supplement policy or certificate is issued on a basis which would require revision of the outline, a substitute outline of coverage properly describing the policy or certificate actually issued must accompany such policy or certificate when it is delivered and contain the following statement, in no less than 12 point type, immediately above the company name: "NOTICE: Read this outline of coverage carefully. It is not identical to the outline of coverage provided upon application and the coverage originally applied for has not been issued."

3. The outline of coverage provided to applicants pursuant to (b)1 above shall be in the language and format prescribed in Exhibit D or D1 of the Appendix of this chapter, incorporated herein by reference, in no less than 12 point type. The outline of coverage shall consist of a cover page, premium information, disclosure pages, and charts displaying the features of each benefit plan offered by the carrier. All plans shall be shown on the cover page, and the plan(s) offered by the carrier shall be prominently identified. Premium information for the plan(s) offered by the carrier shall be provided on the cover page, or immediately following the coverage page, clearly and prominently, specifying both the premium and the mode. All possible premiums for the applicant on all plans offered to the applicant by the carrier shall be illustrated. Appendix Exhibit D shall be used for the outline of coverage for all policies with an effective date for coverage prior to June 1, 2010 and shall not be used with any policy with an effective date for coverage on or after June 1, 2010. Appendix Exhibit D1 shall be used for the outline of coverage for any policy with an effective date for coverage on or after June 1, 2010 and shall not be used for any policy with an effective date for coverage prior to June 1, 2010.

(c) All health and disability income policies, except as specified in this subsection, issued for delivery in this State to persons eligible for Medicare shall notify insureds under the policy. Such notice is not required for: Medicare supplement policies; policies of one or more employers or labor organizations, of the trustees of a fund established by one or more employers or labor organizations, or combination thereof, for employees or former employees, or combination thereof, or members or former members, or combination thereof, of the labor organization; or policies issued pursuant to a contract under Section 1876 of the Federal Social Security Act ( 42 U.S.C. §§ 1395 et seq.). The notice shall either be printed or attached to the first page of the outline of coverage delivered to the insureds under the policy, or, if no outline of coverage is delivered, to the first page of the certificate or policy delivered to insureds. The notice shall be in no less than 12 point type and shall contain the following language:

"THIS IS NOT A MEDICARE SUPPLEMENT (POLICY OR CERTIFICATE). If you are eligible for Medicare, review the Guide to Health Insurance for People with Medicare available from the company."

1. Applications provided to persons eligible for Medicare for the health insurance policies described above shall disclose, using the applicable statement in Exhibit H in the Appendix the extent to which the policy duplicates Medicare. The disclosure statement shall be provided as part of, or together with the application for the policy or certificate.

(d) At least 30 days prior to the effective dates of any Medicare benefit changes, notice shall be provided by carriers to New Jersey insureds describing the revisions of the Medicare program and the resulting modifications made by the carrier to an insured's Medicare supplement policy or certificate to eliminate duplication of Medicare benefits.

1. The notices shall be in the format set forth in the Appendix to subchapters 16 and 23 of this chapter, Exhibit C (Notice of Changes in Medicare and Your Medicare Supplement Coverage), which is incorporated herein as part of this rule.

2. No modification shall be made to an existing Medicare supplement policy or certificate when notices are sent except those modifications necessary to eliminate duplication of Medicare benefits.

3. Notices shall include a description of revisions to the Medicare program and a description of each modification made to the coverage provided under the Medicare supplement policy or certificate.

4. Notices shall provide information as to when any premium adjustment is to be made due to changes in Medicare.

5. Information on benefit modifications and premium adjustments shall be in outline form and in clear and simple terms to facilitate comprehension.

6. Notices shall not contain or be accompanied by any solicitation.

7. No notice shall contain benefits and premium information for more than one policy or certificate form.

(e) Carriers shall comply with any notice requirements of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003.

N.J. Admin. Code § 11:4-23.15

Amended by R.1987 d.95, effective 2/2/1987.
See: 18 N.J.R. 2103(a), 19 N.J.R. 291(a).
(a)6 substantially amended; (a)7 old text deleted and new text substituted.
Amended by R.1988 d.587, effective 12/19/1988 (operative January 1, 1989).
See: 20 N.J.R. 2510(a), 20 N.J.R. 3155(c).
Substantially amended.
Amended by R.1991 d.121, effective 3/4/1991.
See: 22 N.J.R. 771(a), 23 N.J.R. 690(c).
In (a)6 and 7iii: revised internal references; deleted (a)7iv, which was outdated text. In (a)7ii(3)-(4): revised required paper to be used.
Amended by R.1991 d.345, effective 7/1/1991.
See: 23 N.J.R. 1264(a), 23 N.J.R. 2014(a).
Section recodified from 23.8.
Deleted "or nonrenewal", "clearly state the duration, where limited, or renewability and the duration of the term of coverage for which the policy is issued and for which it may be renewed. Such provision shall", "individual" in (a)1. Added (a)2.
Recodified existing (a)2 through 9 as 3 through 10.
Deleted "or hospital or medical service corporation.", "or subscriber", "all" in (a)3.
Designated 3i and ii; deleted "or subscriber".
Added "are required by the minimum standards for Medicare supplement insurance policies, or if" in (a)3ii.
Stylistic changes in (a)4, 5.
Deleted ", other than those issued pursuant to direct response solicitation,", "policyholder or certificate holder", "person or subscriber", "Medicare Supplement policies or certificates ...."; added "insured", "or fees"; changed "10" days to "30" days in (a)6.
Deleted "and hospital and medical service corporations", "or subscriber contracts"; added "Delivery of the informational brochure shall be made whether or not policies are advertised, solicited or issued as Medicare supplement policies as set forth by this subchapter." in (a)7.
Changed "format" to "form" in (a)8.
Deleted "or service corporations" in (a)9. Added "and all other sections of this subchapter" in (a)10.
Deleted "or service organizations"; added "or certificates" in (b)1.
Added 5v. in Outline; deleted "N.J.A.C. 11:4-23.8(5)"; added "section 4" in 6 (outline).
Deleted "Any group", "insurance policy or individual or group subscriber contract", "subscriber contract"; added "All", "and disability income policies", "policy" in (c).
Added (d).
Substantial changes in format of the (b)3 outline as follows: Added "And Premium Information" to heading; added "Use this outline to compare benefits and premiums among policies"; added "and indexed copayments or deductibles, as appropriate" in (b)3 outline 4.
Changed "Service" to "Description"; deleted "Benefit" and "Medicare Pays" columns.
Added "I. Minimum Standards . . ."; deleted "Hospitalization" and "Post-Hospital Skilled Nursing Care".
Added "II. Additional Benefits . . .".
Amended by R.1993 d.26, effective 1/4/1993.
See: 24 N.J.R. 12(a), 25 N.J.R. 141(a).
Rule on requirements for marketing recodified to 23.17; rule on required disclosure provisions recodified from 23.11; Outline of Coverage deleted; individualized Medicare supplement plan charts added; new disclosures required.
Amended by R.1996 d.4, effective 1/2/1996.
See: 27 N.J.R. 3557(a), 28 N.J.R. 165(a).
Substantially amended (a)6 and 7.
Amended by R.1996 d.295, effective 7/1/1996.
See: 28 N.J.R. 1647(a), 28 N.J.R. 3462(a).
Recodified from N.J.A.C. 11:4-23.14 by R.1999 d.38, effective 12/28/1998 (to expire February 26, 1999).
See: 31 N.J.R. 181(a).
Former N.J.A.C. 11:4-23.15, Requirements for application forms and replacement coverage, recodified to N.J.A.C. 11:4-23.16.
Adopted concurrent proposal, R.1999 d.100, effective 2/26/1999.
See: 31 N.J.R. 181(a), 31 N.J.R. 876(a).
Amended by R.2005 d.291, effective 9/6/2005.
See: 37 N.J.R. 1428(a), 37 N.J.R. 3376(a).
In (a), substituted "Centers for Medicare and Medicaid Services" for "Health Care Financing Administration" in 6; in (b)3, deleted "to subchapters 16 and 23" following "Appendix" and substituted "L" for "J" following "A through"; added (e).
Amended by R.2009 d.239, effective 8/3/2009.
See: 41 N.J.R. 956(a), 41 N.J.R. 2928(a).
In (b)3, deleted "A through L" following "All plans", and inserted "or D1" and the last two sentences.